Difference Between Equity and Equality
Equity vs Equality
One of the differences is the fact that equality obviously denotes that everyone is at the same level, whereas equity, in business parlance, denotes the ownership of the shares of a company. Equality alludes to the identical apportionment where dealings, values or qualities are concerned. Equity represents fairness, or what may be termed as the equality of outcomes. This involves factoring in aspects of the system that have put particular groups at a disadvantage.
An example, which would bring out the principal difference between the two, would be how a turkey may be carved up at at family’s dinner table. Equality would mean that everybody ‘“ father, mother and children – would get a piece of the same size. Equity, on the other hand, would mean that they take the sensible option, and divide it according to their needs, i.e. larger sized pieces for the adult and smaller pieces for the children.
When we say equity, we refer to the qualities of justness, fairness, impartiality and even handedness. When we talk about equality, we are talking about equal sharing and exact division.
A perfect example of the practical demonstration of the difference between the two concepts, is the feminist movement. Now, if women demand they should be treated in the same way as men, that would not be possible – equality would not be possible – because women and men are different, and cannot be treated in exactly the same way. However, if they demanded equity in how the world treats them, it would be a genuine demand, because now they are demanding that they be given the same rights as men have as human beings. It is equity that is desirable, not sameness.
Once again, in business parlance, equity denotes the value of something. Suppose I bought a laptop for $500 a year ago, and tried selling it today. It would probably fetch around $250. That is its equity value. Equality, of course, only means exact distribution. Really the difference between the two alludes to the old debate about the preference of quality over quantity.
If one were to take a classical example to distinguish between the two concepts, one could go back to the days of the cold war when the communist block countries tried to practice equality by paying everyone the same, irrespective of their station in life. The capitalist block, on the other hand, paid according to merit and productivity. The efficacy of the later approach, is brought out by the subsequent collapse of the communist order.
Therefore, although seeming to be similar, equity and equality are indeed very different kettles of fish.
1. Equality denotes that everyone is at the same level, whereas equity in business parlance denotes the ownership of the shares of a company.
2. Equity refers to the qualities of justness, fairness, impartiality and even handedness, while equality is about equal sharing and exact division.
3. Equality equals quantity, whereas equity equals quality.
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